Brent locked in stalemate amid Middle East tensions and de-escalation hopes
The front-month ICE Brent contract has lost by $0.81/bbl on the day from Friday, to trade at $101.90/bbl at 09.00 GMT.
IMAGE: Oil storage facility. Getty Images
Upward pressure:
Brent crude’s price has felt some upward pressure as supply-related risks continue to persist.
The US President Donald Trump has issued fresh warnings, stating that Iran risks being “wiped out” entirely, if it does not comply with Washington’s demands.
In response, Iranian military said further attacks will trigger retaliation against US bases in the region and Washington's allies will be considered parties to the conflict.
“The broadening of the Middle East conflict also increases the odds of the conflict persisting for the foreseeable future, and keeping oil supply from the Persian Gulf constrained,” ANZ Bank’s senior commodity strategist Daniel Hynes said.
Downward pressure:
Brent crude’s price has started the week on a soft note, as the market sets its sights on the United Nations General Assembly (UNGA) summit, scheduled to take place in New York later this week.
The meeting will be attended by Iranian President Masoud Pezeshkian. Traders are quietly betting that the high-stakes diplomacy could yield a breakthrough, potentially easing some supply disruptions.
In other news, Trump will hold a high-stakes summit in Washington with Chinese counterpart Xi Jinping on 24 September.
The news has lifted some market confidence as a dialogue between the world's two top economic superpowers could stabilise trade corridors that are currently in fragile conditions.
“Hopes for constructive discussions at this week's UN General Assembly (UNGA) and the upcoming Trump-Xi meeting, helped improve market sentiment,” two analysts from ING Bank reported.
By Aparupa Mazumder
Please get in touch with comments or additional info to news@engine.online
